A1. Effective on deeds that are physically delivered or submitted to the county recording officer on or after August 1, 2004, the Realty Transfer Fee on standard transactions and on "new construction" must be calculated as follows: NOT in Excess of $350,000:

$2.00/$500 of consideration not in excess of $150,000. $3.35/$500 of consideration in excess of $150,000, but not in excess of $200,000.

$3.90/$500 of consideration in excess of $200,000, but not in excess of $350,000.

In Excess of $350,000:

$2.90/$500 of consideration not in excess of $150,000;$4.25/$500 of consideration in excess of $150,000, but not in excess of $550,000;$4.80/$500 of consideration in excess of $550,000, but not in excess of $850,000;$5.30/$500 of consideration in excess of $850,000, but not in excess of $1,000,000;

$6.05/$500 of consideration in excess of $1,000,000.

A2. Realty Transfer Fee rates on transfers by senior citizens, blind persons, disabled persons and on the transfer of property that is low and moderate income is now calculated as follows: NOT in Excess of $350,000:

$.50/$500 of consideration up to $150,000.

$1.25/$500 of consideration over $150,000, but not in excess of $350,000.

In Excess of $350,000:

$1.40/$500 of consideration not in excess of $150,000;$2.15/$500 of consideration in excess of $150,000, but not in excess of $550,000;$2.65/$500 of consideration in excess of $550,000, but not in excess of $850,000;$3.15/$500 of consideration in excess of $850,000, but not in excess of $1,000,000;

$3.40/$500 of consideration in excess of $1,000,000.

AFFIDAVIT OF
CONSIDERATION:

NOTE: An Affidavit of Consideration (RTF-1) is now required to be affixed to and recorded with all deeds transferring "new construction" in addition to existing claims for a partial exemption. To ensure the proper disposition of Realty Transfer Fees into the appropriate funds, "NEW CONSTRUCTION" must now be printed clearly in upper case lettering on the top of the first page of deeds transferring new construction as well as on the Affidavit of Consideration. Grantors conveying title to new construction who fail to subscribe and append an Affidavit to the deed are guilty of a disorderly persons offense.

Q. Do I have to have an Affidavit of Consideration if
the deed says the transfer for is for less than $100?

A. Yes. Chapter 308,
Laws of 1991 requires the filing of an affidavit of Consideration (FORM RTF-1)
every time an exemption is claimed.

Q. A corrective deed is being recorded to correct the
land description. There was an Affidavit of Consideration with the first
recording. DO I have to file another RTF-1?

A. Yes, for each
recording in which there is a claimed exemption, an Affidavit must be
filed.

SENIOR CITIZENS:

Q. What exemption do I use to transfer
property from a senior citizen to a trust?

A. N.J.A.C. 18:16-5.9
says to use "solely to provide or release security for a
debt."

Q. The senior citizen will maintain
control over the property. Once his property is in a trust, when he sells, can
he have a senior citizen partial exemption?

A. No. A senior
citizen exemption is a personal exemption. A trust is a legal entity not
entitled to a partial exemption.

Q.A mother and daughter sell a house
they own as tenants in common. The mother is over 62 and lives in the house.
Can they receive a partial exemption for the mother's share of the home?

A. Yes, as long as
the ownership is as tenants in common. The consideration is split; the
proportionate share owned by the mother qualifies, for the senior citizen
exemption, while the daughter's share does not. Joint tenants must all be age
62 or older in order to qualify for the exemption.

Q.The register of deeds will not split the fee. What
can I do?

A. Pay the realty
transfer fee, then file a request for a refund with the Division of Taxation.
The Claim for Refund form is called "RTF-3" The law requires that the
fee be paid before a deed can be recorded.

ESTATES:

Q.Property is being sold by the executor of the
estate of someone who was over 62 years old. Is this transaction exempt as the
sale by an executor, or can the senior citizen partial exemption be
claimed?

A. The transfer of
property by an executor to the named devisees in a will or to a legal heir in
an interstate estate is exempt. The sale of an estate to someone else is not
exempt. The senior citizen partial exemption is a personal exemption not given
to a decedent or an estate.

Q.My father directed in his will that his property
be sold and the money divided between his children. Is such a sale exempt?

Q. The family home was bequeathed to two brothers and
a sister. One of the brothers wants to buy the interest of the other two for
$100,000. There is a mortgage with a remaining balance of $21,000 on the
property. How is the realty transfer fee calculated?

A. The brother who is
buying the interest of the other two owns one-third. The consideration upon
which the RTF is calculated is determined by adding two-thirds of the mortgage
($14,000) to the consideration he pays his brother and sister ($100,000), or
$114,000.

PARENT TO CHILD:

Q. A father and mother are selling their home to
their daughter and son-in-law. Is this transaction exempt?

A. Yes. As parent to
child, this is an exempt transaction.

Q. A father is selling his home to his daughter and her
live-in boyfriend. Is this exempt?

A. One-half of the
consideration is exempt as parent to child. The other one-half is
taxable.

UNUSUAL
SITUATIONS:

Q.We recorded the deed in the wrong county. What can
we do?

A. Record the deed in
the correct county. The correct county is the one in which the land is located.
File an application for a refund with the State (form RTF-3). Also, file an
application for a refund of the county portion with the incorrect
county.

Q. A deed was received in Atlantic County for property
which is located partially in Atlantic County and partially in Cape May County.
Does Cape May county get any of the RTF?

A. No. Once the full
realty transfer fee is collected, the neighboring county cannot charge an
additional fee since the rates are set by statute.

Q.Is there a realty transfer fee on a lease of less
than 99 years?

A. No. By definition,
a lease of less than 99 years is not a deed for purposes of the realty transfer
fee.

Q. Is a Quitclaim Deed exempt?

A. First, make sure
it is a true Quitclaim Deed. A Quitclaim Deed conveys only that right, title or
interest that the grantor has, or may have and does not warrant that the
Grantor has any particular title or legal interest in the property. The deed
must say "Quitclaim Deed" with specific language such as, "This
deed is called a Quitclaim Deed. the grantor makes no promises as to the
ownership of title, but simply transfers whatever interest the Grantor has to
the Grantee." An attorney or title company cannot imply that a deed is a
Quitclaim Deed. Attorney's often transfer freehold interest on Quitclaim Deeds.
Those transfer are taxable transactions.

DIVORCE:

Q. My client was divorced many years ago. He is
deeding his one-half interest in the property to his former wife for $8,000 and
an original mortgage of $200,000. Is this transaction exempt as "In
specific performance of a final judgment".

A. No. The mere
incorporation of the terms of a separation agreement into a judgment of
divorce does not alter the "essential consensual character" of the
agreement. Thus, for the purposes of the exemption, "In specific
performance of a final judgment" may not be used. The only time that this
exemption may be used is when the judge orders that the transfer be made in
accordance with his orders. The realty transfer fee would be calculated on
$8,000 plus one-half of the remaining balance of the mortgage.

NON PROFIT:

Q. Is a non-profit organization exempt? It is exempt
from other taxes.

A. No. Unless there
is a listed exemption that applies, there are not other exemptions.

BUSINESS
TRANSACTIONS:

In business transactions, the key to
the realty transfer fee calculation is the definition of "consideration". Personal exemptions (senior citizen, blind disabled)
are not granted to legal entities. Businesses dissolving or liquidating and
transferring real estate must pay a RTF on the remaining balance of any
mortgages. partnerships buying the interest of one partner must pay a RTF on
the proportionate amount of mortgage balance plus any other consideration
paid.

Q. There are tax exempt liquidations for Federal
purposes. If someone claims a total exemption based on a "351 or 332" liquidation, is the transaction exempt?

A. Section 351 and
332 liquidations are exemptions from Federal income tax which allow a company
to transfer all assets and liabilities to a parent company without following
the usual rules of adding back depreciation on the disposition of assets. This
does not have anything to do with realty transfer fees. N.J.A.C. 18:16-4.10
provides that:

(a) In the case of a transfer of real estate to
stockholder(s) by a corporation in liquidation, or to partner(s) by a
partnership firm in liquidation, no attempt will be made to project value on
the basis of consideration passing between grantor and grantee, since such a
transaction, in general, represents a return of capital.
(b) the transfer is
not subject to the transfer fee if there is no other "consideration: as
defined in the law.
(c) In the event there are no mortgages, liens or other
encumbrances on the property, no realty transfer fee will be required to be
paid.

Q. Iown the company. Why do I have to pay a realty
transfer fee to transfer property to my company based on the remaining balance
of a mortgage?

A. A partnership is a
distinct legal entity for purposes of transferring property. Additionally,
exemption statues are strictly construed. If there is no applicable listed
exemption, realty transfer fee is to be paid.

SHERIFF'S DEEDS, TRANSFERS,
PRIOR TO FORECLOSURE:

Q. Why do I have to have a Sheriff's Affidavit and an
Affidavit of Consideration when a federal agency sells property?

A. The Sheriff's
Affidavit (Form RFT-8) is a declaration of other liens or mortgages as required
by Chapter 225, Laws of 1979. The Affidavit of Consideration claims the
exemption from the fee as required by Chapter 308, Laws of 1991.

Q. My client, the bank, is taking back real estate so
that we don't have to go to a sheriff's sale. We will eventually cancel the
mortgage when we have sold the property and gotten our money back. The register
of deeds won't record the deed without a fee.

A. The register of
deeds is correct. A realty transfer fee must be paid on the remaining balance
of the mortgage if the mortgage is not cancelled. You are seeking to protect
your investment by taking the property back and avoiding a sheriff's sale. You
are further protecting yourself by holding the mortgage open to maintain a
claim against the borrower. The realty transfer laws were not meant to be a
guide for business decisions. Unless there is a listed exemption from the
realty transfer fee, the fee must be paid.